Punta Gorda, Florida is the fifth fastest-growing metro area in the United States. With this type of population growth, there are plenty of opportunities for rental property investors to make money in the area.
It's essential to know how to protect yourself and your real estate investment. Security deposits are one of the most common ways to mitigate risks.
First, you need to know how they work. Keep reading to learn about the laws regarding these deposits.
Security Deposits: Maximum Amount
Florida State does not limit how much a landlord can charge for security deposits. So, how much is a security deposit?
Cities and counties can set a limit, so it's important to check your county as it can change regularly.
Typically, charging a maximum of two months' rent as a security deposit amount is common. Asking for an additional deposit for pets is legal unless the tenant requires a service or emotional support animal.
A rental property manager who knows the local and federal Fair Housing laws can help you stay compliant.
Where to Store Security Deposits
Landlord-tenant law requires landlords to notify the tenant of the location of their security deposit within 30 days of receiving it.
You have different choices when it comes to storing the deposit. You can put the money in an interest-bearing account. You cannot use this account for anything other than security deposits.
You can also use a non-interest-bearing account to store the funds.
Some landlords choose to post a security bond with permission from the circuit court clerk. This option requires you to pay a 5% annual interest plus the bond amount.
A professional property management company can walk you through the different options to help you decide on the best one.
How to Return Security Deposits
Legally, landlords can make deductions to the security deposit. If no deductions are required, you have to return the security deposit within 15 days of the end of the lease agreement.
A lessee can file a lawsuit against you if you fail to return the funds within the legal timeframe.
If you make deductions, you have 30 days to provide a written notice. Without a written notice, you forgo your right to use the security deposit. These are the deductions you can make to protect landlord rights:
- Damages and repairs beyond wear and tear
- Breach of the lease agreement
- Unpaid rent
You might only use a portion of the security deposit to cover the cost of deductions. This is why an itemized list is important.
Don't Let Security Deposits Get You Down
Security deposits are a form of landlord protection, but they can be complicated. In addition to knowing your rights, you need to understand tenant rights.
PMI Heartland Realty is a team of educated and licensed real estate professionals. We never overlook little details or ignore important rules and regulations.
For years, we've helped Punta Gorda landlords by following a proven process.
Property managers provide you with the peace of mind you need to build a large investment portfolio. With our full-service management services, they can handle security deposits and much more.
Contact us today to talk to a professional.
